Tuesday, May 14, 2019 at 4:58PM
Natural gas prices advanced higher today, closing at their highest levels since the middle of April, with the June contract up nearly 1.5% on the day. While the front of the curve led the charge, we saw some solid strength throughout the forward curve. What factors led buyers into the market? One reason is that we saw a rather large dip in today's production data. There can be some revisions to this data, but will likely remain as a decent day over day decline, even if only temporary. The other bullish catalyst today? It was the weather. We continue to gradually add demand to the forecast over the next couple of weeks. This comes as models converge on a persistent upper level trough over the western U.S, pumping up a strong downstream warm ridge over the eastern half of the nation, seen in today's 6-10 day GEFS modeling: This results in much warmer than normal temperatures over the majority of demand centers from the middle of the U.S. to the East Coast. The pattern type largely remains the same in the 11-15 day projections: This will no doubt conjure up memories of a year ago, when the pattern turned hotter and stayed that way all summer long, leading to one of the hottest summers on record for the nation as a whole, contributing to the very low end-of-season natural gas storage levels at the end of Summer 2018. Is history going to repeat itself this year? Sign up for a 10-day free trial here to find out what our latest research suggests regarding the upcoming season!